Arie Rangott has been sentenced to 27 months in prison for his role in defrauding the federal Head Start program and obstructing a federal administrative investigation. The sentence was delivered by U.S. District Judge Jennifer H. Rearden after a two-and-a-half-week trial.
Acting United States Attorney Matthew Podolsky commented, "Arie Rangott defrauded a vital federal childcare program that aims to serve one of society’s most vulnerable populations. This Office is committed to bringing to justice those who place greed above their responsibility to be stewards of federal funds, and I commend our law enforcement partners and the dedicated team of career prosecutors for their outstanding work."
Between 2021 and January 2023, Rangott served as the shadow executive director of Project Social Care Head Start Inc. (PSCHS), a non-profit entity operating in New York City. PSCHS received millions annually from the U.S. Department of Health and Human Services (HHS) for the Head Start program, funds which were intended to be managed by an independent board of directors. However, it was found that Rangott and others conspired to submit false documents asserting compliance with these requirements while redirecting funds to for-profit companies owned by co-conspirators.
In December 2021, HHS addressed complaints about self-dealing at PSCHS, prompting Rangott and his associates to submit misleading reports denying such activities. An investigation by the HHS Office of the Inspector General in August and September 2022 revealed further efforts by Rangott and others to obstruct inquiries through falsehoods and coordinated deception.
Several accomplices have pleaded guilty. Martin Handler received a 58-month sentence, while Isidore Handler was sentenced to 18 months; Menachem Lieberman awaits sentencing.
In addition to his prison term, Rangott will undergo two years of supervised release. Acting U.S. Attorney Podolsky praised the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, HHS Office of the Inspector General, U.S. Department of Agriculture Office of the Inspector General, and New York City Department of Investigation for their roles in this case.
The prosecution was conducted by Assistant U.S. Attorneys Jacob R. Fiddelman, Catherine Ghosh, Stephanie Simon, Daniel H. Wolf, along with Paralegal Specialist Jayda Foote under the Public Corruption Unit.